The Ugly Side of European Basketball-- Dynamo St. Petersburg Collapses

The unfortunate side of European basketball reared its ugly head this afternoon, Russian time, when Dynamo St. Petersburg’s coaching staff decided to hold a team meeting. Some of the players had felt that something was not right around the team over the past few days, but most just attributed it to the crazy lifestyle that goes along with playing basketball in the formerly communist country. What happened sent shockwaves not just though the team’s lockerroom, but throughout all of European basketball.

In a very surprising and quite unexpected move, Dynamo St. Petersburg officially announced that the team is folding, releasing itself from all of it’s obligations to the millions of dollars in (often multi-year) contracts they owe their players. Considering the fact that we’re talking about one of the richest clubs in all of Europe, a team that finished in 2nd place last year in arguably the third best league in the continent—this is a major blow to both the Russian League and European basketball in general. Dynamo was scheduled to take part in the ULEB Cup this upcoming season, and was ironically featured just today on the front page of the official site in a glowing review that pegged them as serious contenders to win the entire competition. On a sidenote, Unics Kazan is considered the early favorites to take Dynamo’s spot in Group B of the ULEB cup.

Only founded in 2004, Dynamo St. Petersburg came out of the gates with a bang by winning the FIBA Europe League in its first season of existence, under now Benetton Treviso head coach David Blatt--as well as finishing in 5th place in the Russian league. They made the Final Four of the FIBA EuroCup the following season, and finished in 2nd place in the regular season of the Russian league. The club was described just today on the ULEB Cup official website as “One of the best European teams in the last two seasons…an ambitious management, a deep roster, a first-class city and an elite coach like Fotis Katsikaris are enough reasons to believe St. Pete is not the usual ULEB Cup newcomer.”

So what went wrong? According to numerous sources close to the situation we spoke with today--plenty. The official party line coming out of St. Petersburg talks about a major falling out between the city—one of the team’s main financial sponsors—and the club, headed by team president Vladimir Radianov. Some might say that the writing was on the wall, as Radianov was the president of Avtodor Saratov just three years ago when that team went bankrupt and closed its doors as well.

Once the city pulled the plug on more than 5 million dollars in sponsorship money that Dynamo was counting on, it became clear to the front office that the organization no longer had a chance to be able to continue considering the type of money they are committed to over the next few seasons. Without assurances from the city and with another major sponsor—one of the largest banks in Russia-- that also began to waver, Dynamo would not be able to get approval from the Russian Federation to open up the season.

Another main issue leading to this surprising move appears to be internal political conflicts between former Communist party officials on the city board, and the KGB (formerly, the secret police of the Soviet Union), which owns a stake and major influence on all Russian teams with “Dynamo” in its name. The city of St. Petersburg wanted Dynamo to merge with their cross-city rivals Spartak, and when Dynamo refused to move forward with the plan, the city pulled out their money. Being the only team in an extremely modern and attractive city such as St. Petersburg, Spartak is now a team to look out for on the player market in this upcoming summer.

Of major interest to the top teams in Europe is the fact that Dynamo’s entire roster just entered the free agent market. Highly coveted players such as Kelly McCarty ($700,000 per year salary) Ognjen Askrabic ($700,000), Vladimir Veremeenko, Eddie Gill ($600,000), Goran Jeretin ($600,000), Maciej Lampe ($650,000) and many others made millions of dollars between them, but some if not all will have a difficult time finding similar offers in mid-October, just as the player-market is about to be flooded with even more big names falling out of NBA training camps.

With the excitement of Greece beating the US in the World Championships and Barcelona defeating the Philadelphia 76’ers in the NBA Europe Live, there is a well deserved sentiment amongst European basketball fans that the gap between them and the NBA has completely diminished to the point that there will not be that much of a difference in the near future. While results on the court certainly point towards that becoming a reality at some point, the lesson of Dynamo St. Petersburg today and Ulker Istanbul over the summer (who also were forced to fold) is that many European teams and leagues still have a long ways to go in terms of their financial and organizational stability to be able to make the business side of things just as true.